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How to use This Book 17

• Data: the information associated with each process step
• Outcomes: the specifi c products or consequences of the process step
The fourth component of each chapter is reporting. This section exam-
ines how the data generated during the process steps are converted into
meaningful information. It also provides examples of the types of reports that
can help managers improve process performance.
Going further, each chapter employs three pedagogical tools—
demonstrations, real-world cases, and exercises—to reinforce the material.
Demonstrations illustrate either a particular concept or the execution of a pro-
cess step in the SAP ERP system. These demonstrations are in the form of ani-
mations that can be viewed multiple times. Real-world cases are vignettes from
actual companies that illustrate a concept or demonstrate how that company
executes a process. Exercises to be completed in an SAP system confi gured
with GBI data provide a fi nal reinforcement of the chapter’s key concepts.

SAP SOFTWARE
SAP (pronounced by saying each letter individually, like IBM or ABC) is the
pioneer in enterprise systems. SAP was the fi rst company to build a packaged
enterprise system, which means that it designed a single piece of software that
is used by many companies. Prior to that time, software developers had to cre-
ate customized software for every company, which was prohibitively expensive.
SAP introduced the fi rst integrated, end-to-end enterprise system, called
®
SAP R/3, in 1992. The “R” in R/3 stands for “real time.” Prior to the develop-
ment of enterprise systems, companies typically employed a number of differ-
ent systems, each of which supported a single function or department. Thus,
there were sales systems, accounting systems, manufacturing systems, and so
on. These systems were not integrated, so sharing data between and among
them was problematic. As you might expect, this architecture regularly expe-
rienced delays in executing business processes because data had to be trans-
ferred from one system to the next as the process was being performed.
SAP R/3 was designed to eliminate these ineffi ciencies by executing an
entire process from start to fi nish and consolidating all of the process data in a
single database. Consequently, regardless of which individuals were completing
a step in the process, all of the data were available to them in real time. In addition,
everyone else in the company could see the status of the process in real time as
well. In today’s age of Twitter and RSS feeds, this development might seem trivial.
At the time, however, it was a crucial innovation. SAP R/3 was quickly adopted
by one major corporation after another, and it catapulted SAP software onto
the “must do” list for nearly every large company. By 2010, SAP had more than
110,000 customers in over 120 countries, including nearly every Fortune 1000
company. In 2008, SAP’s market share in the ERP category was equivalent to
the market share of the next four largest ERP vendors—combined. Today,
3, 4
more than 75% of SAP’s customers are small and medium-sized businesses.

3 C. Pang, Y. Dharmasthira, C. Eschinger, and K. Motoyoshi, Market Share: ERP Software,
Worldwide, 2008, July 2008, Gartner.
4 A. Pang, Worldwide ERP Applications 2009–2013 Forecast and 2008 Vendor Shares, October
2008, IDC.

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